Microsoft has announced it has upgraded its Hotmail service. Users of the free web-based email service will see a "cleaner and simpler user interface" which includes new tools for dealing with spam.

Hotmail's junk mail filter allows users to set the level of filtering they want - the "exclusive" setting allows users to receive email only from people listed in their address book, effectively shutting down unwanted email.

The new interface will allow users "one-click access" to features such as email folders and the address book as well as to other services, like MSN Calendar.

In New Zealand, MSN partner Xtra reports there are 700,000 active Hotmail users. Worldwide there are more than 110 million according to Microsoft.

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